Products (goods and services)
Products are the outcome of all production activity. They are either tangible in nature [goods] or intangible (services). Products are classified into: Final goods and services are consumed by the ultimate user, the consumer.
Intermediate goods and services are products destined for further
processing or assembly before their sale to the final consumer. They are used in the process of production e.g. steel, cotton, baking flour. However at times, it may be difficult to distinguish between the two.
processing or assembly before their sale to the final consumer. They are used in the process of production e.g. steel, cotton, baking flour. However at times, it may be difficult to distinguish between the two.
For instance, sugar is both an intermediate good and final good. Similarly sugar cane is both intermediate and final good.
Goods are also classified by their expected life-time: durable goods which have a long life, (e.g. furniture, appliances, automobiles, equipment), semi-durable goods, which have a short life-time, (e.g. clothing, shoes, handbags, household articles) and non-durable, goods which disappear at the moment of consumption, (e.g. foods and beverages).
Services are products but of an intangible nature. Television, radio and video production, telephone and other communications, banking, entertainment, health care, education, police and fire protection, life and property insurance are all examples of services.